India Stocks Rise as Vaccine News Fuels Optimism

Indian stocks rose as favorable initial results for a second Covid-19 vaccine fanned optimism of an exit from the pandemic.

The S&P BSE Sensex climbed 0.7% to 43,959.75 as of 9:52 a.m. in Mumbai, while the NSE Nifty 50 Index advanced by the same magnitude. Both gauges extended gains from all-time high closing levels.

Strategists at brokerages including Goldman Sachs, Morgan Stanley, and JPMorgan Asset Management see stocks in India’s $2.2 trillion marketsustaining their record-breaking rally, in part because it’s more sensitive to vaccine-related developments than other Asian markets.

Moderna Inc.’s vaccine was shown to be almost 95% effective in a late-stage clinical trial, anothersign of progress in the hunt for tools to fight the pandemic that continues to spread in some parts of the world.

“The biggest uncertainty was the pandemic, so if there is a solution, there is naturally a big sigh of relief,” said Sudip Bandyopadhyay, who oversees investments at Inditrade Capital Ltd. in Mumbai. “Investors are also watching for how fast any potential vaccines can be delivered and what the logistics will involve.”

India’s equities have also been helped by better than expected results for the September quarter, with 70% of the companies on the Nifty 50 index beating or matching analyst estimates.

Read:India’s Record Highs Spark Talk of Further Upside: Taking Stock

While India’s daily coronavirus infections are down from a September peak, the country still has the world’s second highest number of cases after the U.S.

The yield on the benchmark 10-year government bond was little changed at 5.88% while the rupee strengthened 0.2% to 74.4350 against the U.S. dollar.

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